There you are minding your own business.
You work all day, catch the kid's game and then come home.
You innocently grab the mail and start looking through it as you walk up the driveway.
Junk mail, magazines, a bill and...
a letter from the IRS! So much for your relaxing day.
Millions of Americans go through this scenario every year.
Well, at least the part where they get a letter from the IRS.
With the exception of a Dear John letter, there is probably no more feared piece of correspondence you can get.
After all, what is more scary than the prospects of an IRS audit? So, what should you do when you receive an IRS notice? Well, the first thing may sound obvious - open it up and read it! Many people, however, assume the worst and start picturing worse case scenarios.
They call people in a panic and completely overreact.
They feel pretty stupid when they open the letter only to find the IRS made an adjustment to their return that requires them to pay an extra $20.
The bad news is most people will receive an IRS notice at some point in their life.
The good news is most of these notices involve minor issues.
Even in some fairly significant situations, you may just get a letter demanding you send in more money.
I'll give you an example.
When I was younger, I lived in San Diego.
One summer, I went to work for a couple of months in Breckenridge, Colorado.
At the end of the year, I filed my taxes without including any of my income from Colorado.
I wasn't being devious, I just forgot because it didn't pay that well and I wasn't issued a W-2 or 1099.
After a couple of years, the IRS sent me a notice indicating that my taxes for the year in question were wrong because I had failed to report the Colorado income.
Failing to report income to the IRS is a fairly serious offense, but the IRS just gave me a balance to send in unless I wanted to try to fight their position.
After looking at my records, I realized what had happened and meekly sent in a check.
What if the IRS is more aggressive with you? Well, if the agency wants you to do a face to face with one of their agents...
don't! You can send a CPA or tax lawyer in your place.
This is a far smarter move than going yourself.
You do not know tax law, so you risk completely screwing up your own defense.
Spend the money to avoid this.
There is no disputing the IRS is now issuing more audit notices.
If you get one, do not panic.
Give it a read and see if it is something that can be handled quickly.
If not, get a referral to a qualified accountant and send them to your audit.
You work all day, catch the kid's game and then come home.
You innocently grab the mail and start looking through it as you walk up the driveway.
Junk mail, magazines, a bill and...
a letter from the IRS! So much for your relaxing day.
Millions of Americans go through this scenario every year.
Well, at least the part where they get a letter from the IRS.
With the exception of a Dear John letter, there is probably no more feared piece of correspondence you can get.
After all, what is more scary than the prospects of an IRS audit? So, what should you do when you receive an IRS notice? Well, the first thing may sound obvious - open it up and read it! Many people, however, assume the worst and start picturing worse case scenarios.
They call people in a panic and completely overreact.
They feel pretty stupid when they open the letter only to find the IRS made an adjustment to their return that requires them to pay an extra $20.
The bad news is most people will receive an IRS notice at some point in their life.
The good news is most of these notices involve minor issues.
Even in some fairly significant situations, you may just get a letter demanding you send in more money.
I'll give you an example.
When I was younger, I lived in San Diego.
One summer, I went to work for a couple of months in Breckenridge, Colorado.
At the end of the year, I filed my taxes without including any of my income from Colorado.
I wasn't being devious, I just forgot because it didn't pay that well and I wasn't issued a W-2 or 1099.
After a couple of years, the IRS sent me a notice indicating that my taxes for the year in question were wrong because I had failed to report the Colorado income.
Failing to report income to the IRS is a fairly serious offense, but the IRS just gave me a balance to send in unless I wanted to try to fight their position.
After looking at my records, I realized what had happened and meekly sent in a check.
What if the IRS is more aggressive with you? Well, if the agency wants you to do a face to face with one of their agents...
don't! You can send a CPA or tax lawyer in your place.
This is a far smarter move than going yourself.
You do not know tax law, so you risk completely screwing up your own defense.
Spend the money to avoid this.
There is no disputing the IRS is now issuing more audit notices.
If you get one, do not panic.
Give it a read and see if it is something that can be handled quickly.
If not, get a referral to a qualified accountant and send them to your audit.